Plans to store all patient records in a vast database which can be accessed by researchers and drug firms could be scotched under proposed EU laws which would render the NHS plans illegal.

Plans for an NHS database containing records of all patients in England could be scuppered by proposed European Union laws which would render the scheme illegal.

Every household is being sent a leaflet this month informing them that from April, their medical histories will be shared with researchers and pharmaceutical companies on the database unless they opt out.

But board papers drawn up by NHS senior officials ahead of a meeting today suggest that a draft EU law — which will not go to a vote until next year at the earliest — would mean the national scheme and other large research projects already under way would have to be scrapped.

The documents also disclose that the initiative would cost the taxpayer at least £50 million and the scheme has yet to be approved by the Treasury.

The plans for a giant database have already proved divisive.

Researchers and major medical charities say the digital storage of mass data will advance medical science, helping them understand the causes of disease, spot side-effects to new drugs and detect outbreaks of infectious diseases.

Privacy campaigners claim that individuals could be identified by drugs and insurance companies who could use information to target products and profit from people’s illnesses, though officials say this would not be allowed.

Under the scheme, patients’ data will be automatically uploaded into the care.data system unless an individual chooses to opt out.

Board papers drawn up by Department of Health (DoH) officials warn that proposed EU regulations to harmonise rules on data protection would not allow such a system – because they state that individuals must give explicit consent, knowing the specific purpose for which data is being used.

The paper drawn up by Peter Knight, DoH deputy director of research, information and intelligence, says ministers are now negotiating with member states in Europe because of their concerns.

Pamela Forde, data protection officer for the Royal College of Physicians, said the changes would not only mean the axing of the database, but would kill off most major studies on disease. She said: “The changes being proposed are really far-reaching and would mean a lot of large scale research would be impossible.”

The Ministry of Justice is leading negotiations on the data protection legislation, and ministers have already expressed concern that existing proposals create too much bureaucracy and place too high a burden on businesses.

A spokesman for the Department of Health said: “We are fully aware of the negative impact this would have both on care.data and on UK research and we are working with the Ministry of Justice to negotiate changes.”